“This is about creating an amazing asset and a very strong company, not about retrenching,” Vodafone Chief Executive Vittorio Colao said.Vodafone, the world’s second-biggest mobile phone group, has built its name through rapid global expansion in a series of bold deals in the 1990s and 2000s and is the second-largest player in India.

Overall, service revenue in Europe grew by 0.7 per cent in its third quarter, down from 1 per cent in the second quarter. In its emerging markets — including India, Africa and Turkey — growth slowed to 3.9 per cent from 7.1 per cent.

Shares in the company fell as much as 3 per cent on Thursday morning. By 0934 GMT they were down 1.3 per cent at 190 pence

Britain remained tough, with service revenue declining by 3.2 per cent, which it said reflected increased competition in the business sector, an area of strength for the operator.

Finance Director Nick Read said the company was seeing competition in corporate business from EE, now owned by BT, and from O2, owned by Telefonica.

“Everyone is chasing growth and customers,” he said.

Vodafone reported a 1.7 per cent rise in overall organic service revenue for the quarter, broadly in line with analyst expectations.

The company reiterated its target to generate at least 4 billion euros of free cash flow in the year to March 31, but it said it now expects core earnings to come in at the lower end of a range of 3-6 per cent growth.

“These results are not surprising given the evidence of the deterioration in India but have few specific positives either,” Citi analysts said.